Financial Crime World

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Final Evaluation Report on Liechtenstein’s Anti-Money Laundering (AML) Regime

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Positive Developments

Liechtenstein has made significant progress in implementing AML reforms, including ratification of the Strasbourg Convention and expansion of confiscation powers. The country has also established new institutions and reinforced existing ones with additional staff and resources.

Key Achievements:

  • Significant progress in implementing AML reforms
  • Establishment of new institutions and reinforcement of existing ones
  • Effective implementation of a substantial package of legal and institutional reforms in a record period
  • Delivering results, including prosecutions for money laundering, asset seizures, and increased awareness and compliance culture

Areas that Require Improvement

Despite the progress made, there are still some areas that require improvement. These include:

Challenges to Address:

  • Insufficient powers of the Financial Intelligence Unit (FIU) to access relevant financial information
  • Lack of comprehensive and direct access to beneficial ownership information
  • Inadequate investigative means for law enforcement agencies
  • Tipping-off practices that allow financial institutions and intermediaries to inform customers about Suspicious Transaction Reports (STRs)
  • Existence of “old” bearer accounts (passbooks) that raise issues with regard to FATF Recommendation 10

Recommendations

To address these challenges, the following recommendations are made:

Key Recommendations:

  • Empower the FIU to have access to all necessary information for its analysis, including beneficial ownership information
  • Increase professional staff at the FIU substantially
  • Equip law enforcement agencies with further investigative means, such as undercover operations, controlled delivery of cash, and monitoring of bank accounts
  • Prohibit tipping-off practices and provide appropriate penalties
  • Close down or transform “old” bearer accounts (passbooks) into nominative accounts
  • Introduce a clear legal requirement for including information on ordering and beneficiary customers in financial transactions
  • Join international instruments, such as the 1978 Additional Protocol to the European Convention on Mutual Legal Assistance (ECMA), and reconsider policy barring mutual legal assistance in fiscal matters

Final Assessment

Liechtenstein’s AML regime has improved significantly since the first evaluation round. However, it is essential to ensure sustainability of progress achieved by providing staff continuity at key positions and offering further training to local professionals.